The Lancashire Telegraph understands Hughes met a City delegation in London last night after the Blues had earlier agreed a compensation package with Rovers for the in-demand Welshman.

Chairman John Williams confirmed an acceptable deal with City has been reached for Hughes and his three trusted lieutenants Mark Bowen, Eddie Niedzwiecki and Kevin Hitchcock.

It is believed Rovers stand to receive around £5 million in compensation - thought to be a record between two Premier League clubs - if Hughes agrees to become the successor to Sven Goran
Eriksson.

The Rovers chief, 44, was also thought to be on a shortlist for the Chelsea job, but Roman Abramovich, the Blues' billionaire owner, is now expected to turn to either Roberto Mancini or Frank
Rijkaard instead, after missing out on his top target Carlo Ancelotti, who seems determined to stay at AC Milan.

If that proves to be the case then Hughes will almost certainly seal a move to Eastlands, leaving Rovers to start the search for their third manager in eight years.

Several interesting' candidates, including the former Bolton manager, Sam Allardyce, have already contacted the club to register their interest in the post, which has provided chairman Williams
with plenty of food for thought as he awaits the outcome of Hughes' talks with City.

Confirming the deal with the Blues, Williams said: "We have agreed a package with Manchester City so it's down to them to reach an agreement with Mark now."